Nonprofits in Good Times and Bad Times

Christine L. Exley, Nils H. Lehr and Stephen Terry

No 29630, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: Need fluctuates over the business cycle. We conduct a survey revealing a desire for nonprofit activities to countercyclically expand during downturns. We then demonstrate, using comprehensive US nonprofit data drawn from millions of tax returns, that the public’s hopes are disappointed. Nonprofit expenditure, revenue, and balance sheets fluctuate procyclically: contracting during national and local downturns. This finding is evident even for a narrow group of nonprofits the public most wishes would expand during downturns, e.g., those providing critical needs like food or housing. Our new facts contribute to the charitable giving, nonprofit, and business cycle literatures.

JEL-codes: D64 E30 L30 (search for similar items in EconPapers)
Date: 2022-01
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Published as Christine L. Exley & Nils H. Lehr & Stephen J. Terry, 2023. "Nonprofits in Good Times and Bad Times," Journal of Political Economy Microeconomics, vol 1(1), pages 42-79.

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